What Hong Kong can learn from New York’s blueprint to take on Silicon Valley

Hong Kong, like most global cities, is in a race to keep its competitive advantage as the rapid advance of technologies and the Internet put the emphasis on innovation and fostering new companies over traditional business strengths.   

The Hong Kong government has made efforts to transform the economy into a more innovation-driven one, including setting up start-up facilitators such as the government-backed Hong Kong Science & Technology Parks, while private initiatives include Nest.vc, a venture capital firm working as an accelerator for start-ups.

But to move to the next level, the city may want to pay heed to the plans of New York mayor Bill de Blasio, who has unveiled a series of  proposals drawing in academia and business to build New York into a rival to Silicon Valley.

Speaking at the TechCrunch Disrupt NY event on Monday, de Blasio explained how three pillars, which he identified as professional development, access and innovation, will help New York secure its place as a tech hub.

“I like to brag about the glories of my city; sometimes it’s tempting to feel a little competitive with other cities,” de Blasio said. “This year, New York City has surpassed [San Francisco’s Bay Area] in startup funding requests.”

As part of his plans, de Blasio announced funding of US$29 million to support science, technology, engineering and maths teaching in the city’s public university, City University of New York.

Another US$70 million will improve access to affordable high-speed internet, with most of the money, some US$60 million, to go on building wireless corridors to provide free or low-cost internet access to up to 50,000 low-income residents.

The initiatives follow the city’s Tech Talent Pipeline, which de Blasio launched in May 2014 with US$10 million funding to train New Yorkers to become the hires of choice for tech firms.

De Blasio said the tech ecosystem in New York provides 300,000 jobs and US$30 billion in wages each year.

The plans are similar to suggestions that Google chairman Eric Schmidt made in an interview with the South China Morning Post in late 2013, when he expressed a hope that the Hong Kong government would open more technical universities, attracting more software engineers rather than more investment bankers.

Political squabbling in Hong Kong over electoral reform could make it difficult for the government to win approval from the legislature for funding for new projects, meaning that the private sector may have to take up the running. 

One area where Hong Kong has a competitive advantage is in global finance, and Nest.vc recently joined Singaporean bank DBS to launch a new dedicated start-up accelerator programme to help new and small firms get into the financial technology business, a growing field that encompasses such areas as mobile payment systems, analytics and risk management.

Consulting firm Accenture has estimated that global investments in financial technology ventures tripled to US$12.2 billion last year, from US$4.05 billion in 2013. Investments in Asia-Pacific financial technology ventures have grown to US$767 million last year, from US$245 million in 2013.